Knowing How Hard to Negotiate in Physician Employment Contracts

The Benefits of Professional Contract Review

During their medical training, physicians are taught about medicine. They are not taught how to analyze an employment contract, nor how to evaluate the reasonableness of a given compensation and benefits package. That is why we encourage physicians to consult with a lawyer and compensation advisor on these matters – they have the required expertise to review these issues.

And yet, after talking with their attorney and compensation advisor, physicians often ask, “What now? How do I communicate my thoughts to the employer? And how do I know which changes or modifications to ask for? In this difficult job market, I certainly don’t want to be too aggressive, upset the employer and lose my job offer!”

This highlights another reason to engage an attorney – the attorney can speak from experience and help you determine “how hard” to negotiate with the employer or even handle the negotiation completely.

Contract Negotiating 101:

So, the physician receives the employment contract, reviews it with his/her attorney and physician advisor, and is trying to determine which of the items highlighted by the attorney and compensation advisor to bring up with the employer. Most of the time, the answer is: all of them! At this stage, virtually all employers are open to hearing questions and requests for changes. The exception to this would be if the physician has already had extensive back-and-forth or negotiation with the employer. If that has happened, the attorney may be limited in how much MORE to negotiate. In this type of situation, pushing too much more COULD come across as too aggressive. This is why it’s important for the physician to team up with an attorney as soon as possible, and to delay negotiating with the employer until you do.

That doesn’t mean that the employer will accommodate all or any of the physician’s requests. It simply means that virtually all employers are open to discussing anything at the start. Accordingly, the biggest risk to the physician is that the employer says “no” to the physician’s requests. Given this, the physician ought not hold back at all. The physician need not be hesitant, shy or afraid to ask questions or make requests for employment contract modification at this stage.

A tiny percentage of times (less than 1 percent of the time, we’re told by the attorneys we work with), an employer may react less favorably to negotiation at this stage. They may revoke the offer, for example. In our opinion, this is highly unprofessional. Also, in our experience, when this happens, it is usually a sign that the employer may not be a good fit anyway. Who wants to work for an employer who’s not open to discussing contract details? This unfortunate dynamic is normally the sign of an employer that is unbending, has poor communication in the workplace, and has unfriendly employment conditions. Probably time to move on. Truly, though, it’s probably better that the physician discovered these things about the employer BEFORE signing the contract!

In our process, after the legal review and compensation / benefits analysis, when the employer is approached about making certain modifications, the employer will respond in one of a variety of ways: it will accommodate all requests, it will accommodate none or it will accommodate some and not others. What about the items that are important to the physician, that were rejected? The question becomes “do we push back on these things?” Certainly, pushing too hard at this later stage has the potential to damage the relationship with the employer. However, a skillful attorney will be able to “read” the employer to see if there is any willingness to negotiate further, and if so, determine what leverage can be created on the physician’s behalf to do so.

Remember, the actual contract review is only part of the process in “closing” an employment situation. A physician needs to use the information gleaned from the review to communicate the changes he or she wants. As this process of communication continues, it can become more and more delicate and awkward! Skillful attorneys and compensation advisors can help physicians navigate these waters with confidence.

Do you need to have a contract review? Contact us today!

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